Why are financial expenses not included in production costs in basic accounting?

The specific process is as follows: Step 1: The financial accountant reviews the original vouchers collected, reviews the legitimacy and authenticity of the bills, and signs the original vouchers after the audit and submits them to the financial manager for review and signature The second step:

Classify the original voucher signed by the financial manager and hand it over to the general manager for approval Step 3: Make the accounting voucher after the original voucher approved by the general manager, and print it for the financial manager to review.

The landlord may think that the financial expenses are also expenses, and in the end, they are all for the production of products, and they should also be included in the production costs. The most classic financial expenses are the interest on bank loans, and there are other financial handling fees, foreign currency exchange gains and losses, etc., only the interest expenses incurred during the construction of fixed assets are included in the cost of fixed assets, as long as the fixed assets are completed, the interest expenses will be credited to the financial expenses, and the interest on the borrowings incurred at other times will be included in the financial expenses. Production costs are indirect expenses (manufacturing costs) such as raw materials directly used to produce products, semi-finished products (direct materials), wages of workers who directly produce products (direct labor), depreciation of equipment incurred in the workshop for the production of products, fuel power consumption, and wages of workers who do not directly produce products.

When the product is finished, it will be included in the inventory and eventually form an inventory. You will find that the production costs and financial expenses are not the same things, and these two are completely different types of accounts.

Because financial expenses are only bank fees, interest receipts and payments, etc., which cannot be used as production costs.

Production costs: materials, production labor, production expenses, financial expenses, management expenses, and operating expenses are indirect expenses and do not need to be included in the cost.

Manufacturing expenses are direct expenses that can be included in costs.

Financial expenses and production costs are two types of concepts.

Financial expenses are generally bank fees, etc., and production costs are generally the cost of inventory or human resources consumed.

Production costs are related to the expenditure in the process of production and operation.

Expenses that should not be included in the cost of production of the product are: Expenses that are not included in the cost of the product include period fees.

Expenses that are not included in the cost of the product include period fees. Period expenses refer to the costs incurred by the enterprise in the current period and cannot be directly or indirectly attributed to the operating costs.

Rather, it is directly included in the current profit and loss, including sales expenses and management expenses.

and financial expenses, etc. It is not included in the specific cost accounting object, mainly because the period expense is the expenses incurred by the limb enterprise to organize and manage the entire business activities, and it is not directly related to the material procurement and finished product production that can determine the specific cost accounting object. That is, it is easy to determine the period of its occurrence, so it is difficult to determine the product to which it should belong, and it cannot be included in the manufacturing cost of the product, but is deducted from the profit or loss in the current period at the time of occurrence.

1. Manufacturing expenses are the indirect costs incurred by enterprises in producing products and providing services. Specifically, there are the following items: the wages of the management personnel of each production unit, employee welfare expenses, housing construction costs, labor protection expenses, and the loss of work stoppages during seasonal production and repairs.

2. Production costs can be divided into three types:

1) Direct materials, such as: raw materials.

2) Direct labor, such as: wages of employees in the production workshop.

3) Manufacturing costs.

1. Manufacturing expenses are generally indirectly included in the cost, and when the manufacturing expenses occur, it is generally not possible to directly determine the cost calculation object to which it belongs, so it cannot be directly included in the cost of the products produced, but must be collected in advance according to the place where the expenses occur, and then use a certain method at the end of the month to distribute among the cost calculation objects, and include them in the cost of each cost calculation object.

2. Production cost refers to the cost of raw materials, fuel and power, labor cost, depreciation and repair cost of fixed assets and other related expenses directly consumed in the production of products.

Many enterprises often sell their own goods in installments, and if the written contract or agreement has agreed on the payment date, the realization of revenue should be recognized according to the date of payment agreed in the written contract or agreement. How should accounting entries be made when selling products in installments?

Accounting entries for the sale of products in installments.

When recognizing revenue and carry-forward costs for installment sales products, the cost of sales that should be carried forward in the current period should be calculated according to the ratio between the total cost of sales of the product and the total sales revenue.

When the product is shipped.

Borrow: Dispatch the goods.

Credit: Inventory of goods.

When the payment is made in installments.

Borrow: Bank deposit.

Credit: main business income.

Tax Payable – VAT payable (output tax).

When the cost of sales is carried forward.

Borrow: Cost of main business.

Credit: Issuing goods.

It is worth noting that in the new accounting standard, the sales proceeds of installment collection sales need to be recognized in a lump sum according to the fair value of the goods, that is, the present value of the total installment receipts. If there is a discrepancy between the sales amount and the VAT tax base, there will be problems such as not knowing how to issue special VAT invoices, which shows that there are many differences in the tax treatment and accounting treatment of installment sales.

In the accounting process, we need to determine the fair value of the contract receivable or the price of the bargain price receivable. The difference between the contract price receivable and the fair value shall be calculated according to the amortized cost of the receivable and the effective interest rate, and the financial expenses shall be offset. In the context of taxation, income refers to the total inflow of economic benefits of enterprises, in other words, as long as an inflow can increase the economic interests of enterprises, it is income.

Production costs belong to the cost category. The debit registers all the expenses that should be included in the cost at a certain stage in the production and operation process, and the credit registers the actual cost transferred out at a certain stage of the closed production and operation. The debit balance at the end of this account reflects the cost of products that have not yet been processed or the cost of agricultural products that have not yet been harvested.

Production costs refer to the production expenses incurred by the production unit for the production of products or the provision of services, including various direct expenditures and manufacturing expenses.

Direct expenses include direct materials (raw materials, auxiliary materials, spare parts, fuel and power, etc.), direct wages (wages and subsidies for production personnel), and other direct expenses (such as welfare expenses).

Manufacturing expenses refer to the expenses incurred by the branches and workshops in the enterprise for organizing and managing production, including the salaries, depreciation costs, maintenance costs, repair costs and other manufacturing expenses (office expenses, travel expenses, labor insurance premiums, etc.) incurred by the branch and workshop management personnel

How to calculate the production cost?

There are generally five methods of cost accounting for the production of cracked ants, namely: variety method, batch method, step-by-step method, classification method and ABC cost method.

Cost accounting refers to the management activities of classifying, summarizing, and accounting the expenses incurred in the production and operation process of an enterprise in a certain period of time according to their nature and location, calculating the total amount of production and operation expenses incurred in the period, and calculating the actual cost and unit cost of each product respectively.

When making accounting entries, are manufacturing expenses directly included in production costs?

Hello, I'm here to help you solve this problem. "Manufacturing expenses are only a prudent aggregation and distribution account for production costs, which are set up as needed. If a certain cost needs to be shared between two or more products, then it needs to be included in the cost of leniency and apportioned according to certain conditions, and if only one product is produced, then it can be directly included in the production cost.

Sometimes, according to the needs of the assessment, such as the assessment and modification of the auxiliary production workshop, it can also be included in the auxiliary production cost first, and then transferred to the production cost according to the cost flow. Generally speaking, the setting of subjects is not rigid and absolute, but is set up according to the needs of accounting. ”

The "Production Costs" account accounts for the direct expenses related to the production of products, such as direct materials, internal direct labor, etc., and the "Manufacturing Expenses" account accounts for the indirect expenses incurred in organizing and managing production, such as workshop managers.

salaries of employees, depreciation expenses of production equipment, etc.

Manufacturing expenses are the accounts used to calculate costs after the breakdown of production costs, and the balance of the "manufacturing expenses" account is generally transferred to the "production costs" account at the end of the period.

Production cost is the most basic account for accounting costs. Manufacturing expenses are auxiliary production workshops, or indirect production workshop expenses, but manufacturing expenses are ultimately transferred to production costs, so that direct costs and indirect costs can be distinguished.

The cost of production is the amount of production that is incurred for the production of products or the provision of services.

DU production expenses, including direct expenses and manufacturing costs.

DAO. Direct expenses include direct materials (raw materials, auxiliary materials, spare parts, fuel and power, etc.), direct wages (wages and subsidies for production personnel), and other direct expenses (such as welfare expenses).Manufacturing expenses refer to the expenses incurred by the branches and workshops in the enterprise for organizing and managing production, including the salaries, depreciation costs, maintenance costs, repair costs and other manufacturing expenses (office expenses, travel expenses, labor insurance premiums, etc.) incurred by the branch and workshop management personnel

Production cost refers to the raw materials, power, labor costs, etc. that are easy to use in the production of products; The manufacturing cost mainly refers to the power and labor costs consumed. It can be seen that manufacturing expenses are part of the production cost.

Production cost refers to the raw materials used to make the product, and manufacturing cost refers to all the expenses incurred when processing the product.